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Post Office Horizon scandal explained: Everything you need to know


After more than 20 years, what is now referred to as the Post Office Horizon scandal has become headline news. Computer Weekly has played an important part in exposing what has been described as the widest miscarriage of justice in UK history.

In 1999, the Post Office’s single shareholder, the UK government, began automating accounting processes at about 14,000 Post Office branches. This saw the introduction of a centralised computer system from supplier Fujitsu, which all branches were connected to. This system replaced traditional paper-based accounting practices.

But problems ensued, and there was a sudden increase in the number of subpostmasters suffering unexplained accounting shortfalls. Rather than investigate the problems and fix them, the Post Office blamed the branch operators, many of whom it prosecuted for financial crimes, with many more made bankrupt and sacked.

What is the Horizon system?

Horizon is software that was originally developed by UK software company ICL, which was acquired by Japanese IT giant Fujitsu in 1998. The system has an electronic point of sale service (EPOSS) that enables subpostmasters and branch workers to key in sales on a touchscreen, with the accounts being automated in the background. At the time of its roll-out in 1999/2000, it was the biggest non-military IT project in Europe.

What problems were caused by the system?

Almost immediately after the installation of Horizon at Post Office branches, there was an increase in the number of subpostmasters experiencing accounting shortfalls that they could not explain. Many had never previously experienced such shortfalls. Under the paper-based system, they could track back and find the cause. But not anymore.

And while the technology had changed, the contract between the Post Office and subpostmasters, who owned their own businesses but were agents for the Post Office, remained the same. It stated that any accounting shortfalls were the responsibility of the subpostmasters unless they could prove otherwise. But without the chain of evidence created by paper-based accounting methods, proving the losses were not their fault was near impossible for many.

Who was affected?

Subpostmasters have a contract with the Post Office to run branches, but they are not employees of the Post Office. They usually have a retail business connected to the Post Office, the idea being that the retail operation will gain more customers through the Post Office drawing people in. There are also Crown branches, which are owned by the Post Office. These larger operations have branch managers in place.

How were subpostmasters affected?

For 15 years after the roll-out of Horizon, the Post Office – which has private investigation and prosecution powers with no need for police involvement – prosecuted  more than 700 subpostmasters for crimes such as theft and false accounting. Hundreds of subpostmasters were sent to prison and many more received punishments such as being forced to do community service and having to wear electronic tags. They lived their lives with criminal records.

Hundreds were made bankrupt, losing their livelihood, and many struggled after being forced to pay the Post Office to cover shortfalls that didn’t exist outside the Horizon system. The lives of the victims and their families were severely impacted, with several suicides linked to the scandal and many cases of illness caused by stress.

How did the Post Office keep a lid on this for so long?

The Post Office was determined to keep a lid on the Horizon problems. To do this, it instructed staff in its call centre, which was the first contact point for subpostmasters having problems, to tell callers they were the only ones experiencing problems.

It went further than this by using its legal teams and deep pockets to defend itself against accusations, in court if necessary. It bragged about stopping subpostmasters from “jumping on the Horizon bashing bandwagon” when it silenced them. It also lied to journalists, politicians and anybody else who questioned the robustness of the Horizon system.

How the Post Office used fear to deter subpostmasters from challenging Horizon

The Post Office used criminal and civil legal action to shut subpostmasters up. If subpostmasters continued to complain and make noise about the system, it would find ways to stop them because it didn’t want the wider network of branch operators to find out.

For example, if a subpostmaster being blamed for an unexplained shortfall sought expert IT advice, the Post Office would often back down. In 2003, when the Post Office was suing a subpostmaster who was blaming Horizon for shortfalls at her branch in Lancashire, a judge ordered it to appoint an expert IT witness. When the expert revealed problems with Horizon, the Post Office paid off the subpostmaster and forced her to sign a non-disclosure agreement.

At around the same time, the Post Office took Lee Castleton, a subpostmaster in Bridlington, to court over an unexplained shortfall of £35,000. Castleton, who was one of the first seven victims interviewed by Computer Weekly, refused to pay the money, citing computer problems as the cause of the shortfall. The Post Office spent over £300,000 crushing Castleton in court. It bankrupted him and devastated his and his family’s life.

The Post Office also sent people to prison to make an example of them. Former subpostmaster Seema Misra was prosecuted and sent to prison based on evidence from the Horizon system. After she was convicted, former Post Office head of criminal law Jarnail Singh wrote a celebratory email to colleagues, claiming this result would stop others from “jumping on the Horizon bashing bandwagon”.

What was Computer Weekly’s role in exposing the scandal?

Computer Weekly broke the first story that exposed the problems being experienced by subpostmasters.

In 2004, Alan Bates, a subpostmaster in north Wales, contacted Computer Weekly about the fact that he was getting unexplained shortfalls, which he was convinced were caused by Horizon errors. Nothing was written, but in 2008, Lee Castleton also contacted Computer Weekly telling a similar story. This was enough to spark a wider investigation.

A year later, Computer Weekly told the story of seven subpostmasters who were experiencing unexplained losses. This stimulated Bates’ fight against the Post Office, which had already been going on for nearly 10 years. The article revealed to subpostmasters who were having Horizon problems that they were not alone and that the Post Office was lying to them. Computer Weekly continues to investigate and report on the story to this day.

Who is Alan Bates?

In 1998, Alan Bates and his partner Suzanne Sercombe bought a Post Office in Craig-y-Don, north Wales. It was a plan to give them both time to spend on things outside work – in Bates’ case, this was walking in the hills; for Sercombe, arts and crafts – while still working.

Back then, the Post Office was run using manual systems, but by the end of 2000, these were replaced by the Post Office’s Horizon retail and accounting system, from Fujitsu – and things quickly went wrong.

Bates was one of the seven subpostmasters interviewed as part of Computer Weekly’s first investigation. He experienced unexplained losses and refused to sign off accounts, because he was sure the losses were caused by computer errors. The Post Office tried to force him to sign off the accounts, but he continued to refuse. The Post Office terminated his contract, taking his job, life savings and retirement plan with it.

But Bates was not done with the Post Office. He set up a website to try to find other subpostmasters having problems and campaigned at events such as the National Federation of Subpostmasters (NFSP) annual conference.

Photo of the Post Office branch owned by Alan Bates and Suzanne Sercombe in Craig-y-Don, Llandudno, Wales
The Post Office branch owned by Alan Bates and Suzanne Sercombe in Craig-y-Don, Llandudno, Wales

What is the Justice for Subpostmasters Alliance?

Just a few months after Computer Weekly publicised the plight of subpostmasters, Bates had been approached by more subpostmasters who were experiencing similar problems and had found others. Together, they formed the Justice for Subpostmasters Alliance (JFSA) and planned a meeting in Fenny Compton, a village in Warwickshire, due to its central location. Subpostmasters and former subpostmasters from across the country turned up and a campaign was born.

Why did MPs get involved?

One JFSA member – and another of the first seven interviewed by Computer Weekly – is Jo Hamilton. The former subpostmaster in Hampshire started experiencing problems in October 2003. Post Office auditors visited the branch in March 2005 and told Hamilton she owed £36,000. They prosecuted her for theft and 14 counts of false accounting.

The Post Office told her it would drop the theft charge if she pleaded guilty to false accounting. Fearing prison, she agreed, but evidence has since proved the Post Office had no evidence of theft. Hamilton says the case did not deal with the issue of IT.

She was given a year’s probation. Her house was remortgaged to pay the money, and the villagers in South Warnborough collected £9,000 between them to help. Her local MP, James Arbuthnot, got involved with Hamilton’s case after Computer Weekly revealed her story. The Conservative MP, now in the House of Lords, became a major campaigner in Parliament for the subpostmasters, alongside Labour MP Kevan Jones, whose constituent Tom Brown, a former subpostmaster in Newcastle, also suffered problems with Horizon.

What was the mediation scheme and Second Sight investigation?

With MPs beginning to raise issues, the government-owned Post Office was forced to take concerns seriously. In 2012, to satisfy demands from politicians, it launched an external review and mediation scheme to look at cases where subpostmasters were alleging problems.

As part of this, the Post Office appointed and paid forensic accountancy company Second Sight to investigate cases. There were fears this would be used to sweep the issue under the carpet. But if this was the Post Office’s plan, as many suspected, it backfired. It soon became apparent to Second Sight that the subpostmasters were not thieves and fraudsters, but hard-working people struggling with a computer system and an organisation that cared for the reputation of that computer system over the very welfare of its subpostmaster network.

In 2013, Second Sight produced an interim report that revealed serious concerns about the system.

Why did the Post Office end the mediation scheme and stop Second Sight’s investigation?

In March 2015, on the eve of the publication of its full investigation report, Second Sight’s work was stopped and the mediation scheme was closed. It had become clear Second Sight was getting close to the truth. The final report found there was a real possibility that there had been miscarriages of justice in the Post Office prosecutions. It said the organisation had been too quick to prosecute before investigating evidence.

With the Post Office obstructing progress, it was time for a different approach. This is when the JFSA began its work towards a group litigation order (GLO).

What was the Bates and others versus Post Office High Court group litigation order?

In 2015, after the collapse of the mediation scheme, the JFSA announced that it was preparing a group litigation, through which hundreds of victims would sue the Post Office for the damage inflicted on them by the error-prone Horizon system, which the organisation still said was robust and did not contain errors that could cause account shortfalls.

A group action is a case where a number of claimants with similar claims get together to initiate an action against a single party. It is similar to a US class action. Freeths Solicitors and Henderson Barristers Chambers prepared the civil action through the High Court. Funding for the group action was provided by litigation funders, who lend money to cover legal costs, which is paid back with interest when a case is won. About 1,000 former subpostmasters applied to join the action and it went forward with 555.

The court case proved subpostmasters were right about the Horizon system – it contained bugs, errors and defects that could cause accounting shortfalls. It revealed the truth and gave convicted subpostmasters the evidence they needed to appeal their convictions

In January 2017, the GLO was given the green light when the High Court of Justice agreed to manage the case.

In November 2018, the first of four planned trials began, with evidence from Alan Bates himself.

In December 2019, after two trials – the first examining the contract between the Post Office and subpostmasters, and the second focused on the Horizon system – the Post Office conceded and settled with the subpostmasters. But this occurred after the Post Office tried to get the managing judge, Peter Fraser, to recuse himself, accusing him of bias.

The 555 claimants were awarded £58m in compensation, but after costs only £11m was left to share between them. But the case had proved they were right about the Horizon system – it contained bugs, errors and defects that could cause accounting shortfalls.

It revealed the truth and gave hundreds of convicted subpostmasters the evidence they needed to appeal their convictions. The Criminal Cases Review Commission (CCRC) took on cases and the fight to quash convictions began

Why is the Post Office scandal seen as the widest miscarriage of justice in UK history?

In December 2020, the first six subpostmasters had their convictions based on Horizon evidence quashed in Southwark Crown Court. In April the following year, a further 39 wrongful subpostmaster convictions were overturned in the landmark case bearing the name of Jo Hamilton, Hamilton and others versus Post Office, in the Court of Appeal.

The judge not only ruled that the prosecutions were wrongful, but that they were an affront to justice. Some 93 convictions related to Horizon have now been overturned, and many more are expected.


Former subpostmaster Hughie “Noel” Thomas is congratulated outside court after having his conviction quashed in April 2021
Former subpostmaster Hughie “Noel” Thomas is congratulated outside court after having his conviction quashed in April 2021

Why is compensation for subpostmasters still an ongoing injustice?

Despite more than two decades of suffering for many subpostmasters and four years having passed since the High Court judgment, most subpostmasters are yet to receive the compensation they are due. The Post Office has a number of different compensation schemes but progress to pay subpostmasters, many of whom are in financial difficulty, is too slow. Many have died before receiving the money they are owed.

What is the statutory public inquiry?

After the High Court victory in 2019, the first thing Alan Bates said to Computer Weekly was that he wanted a statutory public inquiry into the scandal. He got it in May 2021, when a government inquiry into the scandal was made statutory.

The inquiry, chaired by former judge Wyn Williams, is split into seven phases. It has so far heard statements from victims in the human impact phase, investigated the Horizon IT system, looked at its operation and knowledge of errors, as well as legal action against subpostmasters.

Picture of former subpostmaster Alan Bates outside the High Court in 2019
After the High Court victory in 2019, Alan Bates (pictured left) called for a statutory public inquiry into the scandal – he got it in May 2021

What has the public inquiry exposed?

The human impact hearings were shocking, revealing the extreme suffering of people at the hands of the Post Office. Other phases have revealed that the Post Office had knowledge that the Horizon software had bugs when rolled out, prosecution witnesses changed their statements when prompted by the Post Office, and lawyers hid evidence during trials of subpostmasters because it would have made their prosecutions unsafe.

Who has been held to account?

So far, no Post Office or Fujitsu executives have been held accountable or punished for what happened. In fact, Fujitsu continues to cash in on government IT contracts and former Post Office CEO Paula Vennells walked away from the organisation in disgrace with a huge payout. The only people who have been punished are the victims of the scandal.

Who is Paula Vennells?

Paula Vennells, a former Anglican priest, was CEO of the Post Office from 2012 to 2019 after serving in other senior roles at the organisation. She was awarded a CBE for services to the Post Office in 2019.

She jumped ship just prior to the damaging High Court judgment, which slammed the management of the company that punished subpostmasters for mistakes made by its own computer system. She took more than £400,000 in pay and bonuses with her.

There are calls for her to be stripped of her CBE because of her role in the Post Office scandal. Last year, Alan Bates turned down an OBE because he believed it would be “inappropriate” while victims still suffer and one of the scandal’s architects retains her honour.

What is Mr Bates vs the Post Office about?

An ITV drama, Mr Bates vs the Post Office, was broadcast in January 2024, bringing the true extent of the Post Office scandal to a wider public. In the video below, some of the actors who played the real-life victims of the Post Office talk about the appalling way in which these innocent people were treated.



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